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India government ally considers withdrawing support over retail reforms

  • A crucial political ally is due to decide today whether it will withdraw from the Indian government.

    The Trinamool Congress party has demanded that the Congress-led coalition government reverse its decision to open up India's lucrative retail sector to global supermarket chains.

    The move is aimed to boost the country’s waning economy.

    International firms such as Walmart and Tesco will now be able to buy up to a 51 percent stake in multi-brand retailers. However, small shops fear they will be put out of business.

    Last year, the government suspended a similar plan following opposition from its allies and political rivals.

    On Saturday, Mamata Banerjee, the leader of the Trinamool Congress party and chief minister of West Bengal state, gave Delhi 72 hours to scrap the policy, threatening she may withdraw from the government.